Helping local governments deliver public value through innovation

In April 2024, KPMG and the Public Sector Network’s Local Government Roadshow brought together local governments and private industry experts from across Australia and New Zealand to identify and address the sector’s key challenges and opportunities.

Polling questions highlighted the current issues faced by local governments, including the growing need for innovation across the sector. As councils focus on maintaining financial sustainability, they also face the dual challenge and opportunity of adopting technology and fostering agility to deliver on higher community expectations.

The post-roadshow report, Unlocking capabilities to uplift service experience provides key insights into how local governments can improve customer and community experience through a framework of six focus areas.

Key challenges for local governments in 2024

Financial sustainability

61% of councils in Australia and New Zealand see financial sustainability as an immediate priority.

AI and machine learning

84% of councils believe AI and machine learning will impact council operations in the next 2–3 years.

Service review programs

More than 50% of councils are just starting or still planning their service review programs.

Six priority areas for local governments

Creativity and innovation

  • For local governments to ensure continuity of services, financial sustainability and resource optimisation are essential. Leaders need to think strategically and commercially while also developing creative cost-saving solutions.
  • Local governments need to foster a culture of creativity, embrace risk for progress and have patience in measuring outcomes.

Service design

  • Local governments face growing pressure to deliver tailored, frictionless services while balancing resource constraints.
  • To improve customer experience through service design, councils need to adopt a human-centred approach, balance personalisation with automation, and connect what is happening externally with changes that are needed internally.


  • Local governments are increasingly turning to digital innovations and AI for enhanced efficiency and user satisfaction, but they face the challenge of quantifying return on investment and retaining the ‘human touch’.
  • To improve customer experience through technology, councils should conduct a thorough needs assessment first, ensure technologies are inclusive and accessible, invest in training for greater uptake, and retain important face-to-face options.

People and culture

  • People and culture are key to improving customer experience, but attracting and retaining talent in local government is a challenge.
  • To become employers of choice, councils need to embrace a culture of inclusion and engagement, invest in professional development, and offer competitive benefits and flexibility.

Partnerships and collaboration

  • Partnerships and collaboration can unlock and optimise innovative solutions by pooling resources, knowledge and capabilities to streamline services and better serve the collective needs of the community.
  • Councils should look to build cross-sector partnerships, leverage shared technology models, create clear collaboration frameworks and use collaboration as a driver for engagement.

Security and safety

  • With councils increasingly leveraging data for more personalised and efficient services, they need effective strategies for managing information securely, protecting against cyber threats, and maintaining citizen trust.
  • To ensure data security and safety, councils should look to embed security across their organisations, foster a culture of security awareness, and implement robust data protection policies.

Uplifting local government with KPMG

KPMG’s Cities of Value framework helps guide councils in the delivery of public value through digital innovation, physical infrastructure and a focus on sustainability.

Our Local Government team can help you plan, develop and implement your service review program for greater uplift, value and engagement of community services while maintaining financial sustainability.

Meet KPMG’s Local Government team

KPMG's Government-related thought leadership and insights